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Iowa health-care cost containment bureau considered

Rod Boshart

Apr 4, 2012

DES MOINES — State officials would be required to track available data on health-care costs with an eye on finding ways to control costs and slow the growth of insurance premiums under a bill under consideration by the Democratic-controlled Iowa Senate.

Senate File 2230, which cleared a Senate subcommittee on Wednesday, would require the state insurance commissioner to establish a health-insurance and cost-containment bureau within the insurance division. It would be responsible for holding health carriers accountable for the fair treatment of health-care providers and developing standards for health insurance geared toward improved accessibility, quality and affordability of care.

The bureau would be assisted by a new 14-member advisory board comprised of seven voting members appointed by the governor and subject to Senate confirmation. Members would represent small business, consumers, insurance and health-care providers and a health-care actuary or an economist with expertise in health insurance. Non-voting members would include the insurance commissioner, the directors of state human services and public health agencies and four legislators.

Proponents said the expanded data collection would bring more transparency to often complicated and disjointed medical charges. Currently, Iowa hospitals collect some cost data, but a representative of the Iowa Hospital Association told the three-member subcommittee that the effort is limited by federal restrictions to certain health-care records.

“This would be the most significant proposal that we would have to drive down costs for consumers in the short run,” said Sen. Jack Hatch, D-Des Moines, who noted that 10 states currently have data-collection programs, three that are voluntarily operated.

He said the cost of Iowa’s government-based effort initially be $500,000 to $2 million and be paid for by a combination of state and federal funding sources and fees paid by insurance carriers.

“I think it is a pretty thorough and comprehensive approach to containing costs,” Hatch said.

Sen. Matt McCoy, D-Des Moines, chairman of the subcommittee that approved the measure on a 2-1 vote, said health-care expenses are an area for government and private business that is “without a budget” because of the unpredictability of costs and the difficulty in tracking medical-related information.

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“Right now, we don’t have any transparency in the system,” McCoy said. “Until we know that, how can we manage the cost?”

Sen. Roby Smith, R-Davenport, who declined to support the measure, said he was concerned that Hatch was unable to predict whether the new oversight process would reduce insurance premiums for consumers. He also said the proposed legislation emerged late in the session on a fast track in the Senate and likely would face an uphill battle in the GOP-led House if it manages to win Senate approval before the Legislature adjourns later this month.

No one spoke against the bill during Wednesday’s subcommittee meeting, but the Federation of Iowa Insurers was registered in opposition to Senate File 2230.